LACERS BOARD UPDATE: LACERS to create trust to keep health costs down


Michael Wilkinson, LACERS/Legal Representative

By Michael R. Wilkinson
LACERS/Legal Representative

The LACERS Benefits Administration Committee and the full board has approved the creation of a special trust to keep premium savings from years when health premium costs are down so that it can be used to provide relief in other years when health premiums would otherwise spike upward.

In total the medical, dental and vision premiums were down 1.2 percent for the 2019 renewals for a total of approximately $133 million. The medical premiums were down 1.6 percent; dental was up 3.7 percent; and vision was also up 3.7 percent.

For the health carriers, Anthem was down 2.4 percent, Kaiser down 0.8 percent, United Healthcare down 5.6 percent and SCAN unchanged.

The premiums will be renewed with the most of the plans being renewed at the 2018 rates and savings, for plans with reductions, going into the trust to be used for sharp medical increases in the futures. The Anthem HMO plan (under 65, or Medicare Part B only) experienced a 9.7 percent decrease, which will be passed on to the premium renewal. Kaiser Senior Advantage experienced a 2 percent increase.

This is a great time to think about the relationship between good health and reasonable health premiums. If we are eating well, getting our exercise, going in for regular health checkups and taking our medications, then we feel better and enjoy life. Another benefit is that our health dollars go further because preventive medicine is doing its job and we need less trips to the doctor and the hospital.

Anthem has now added SilverSneakers, the program that provides for a free gym membership, to its HMO and PPO plans. Previously this was available only to members with Medicare Parts A and B.

The LACERS board also took up the medical subsidy. The maximum medical subsidy for most members who are under 65 or Medicare Part B only will stay at $1,790.80, for Tier 1 members, even though the Kaiser premium dropped to $1,599.32. The LACERS Board exercised its discretion to keep the higher premium amount to provide for its members. This subsidy more than covers the amount needed for Kaiser’s two -party coverage. The maximum subsidy for members with Medicare Parts A and B was set at $542.51. Tier 2 members only get a subsidy if they are at least 65 and have Medicare Parts A and B.